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What ‘natural’ really means to consumers

GNT’s guide to global consumer demands

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Index

Exploring the‘clean label’ trend 1

Positive colour claims canuplift brand preference 7

‘Clean’ labels are verymuch in demand 2

Particular concernsfor parents 8

Colour is key 3 Food manufacturersneed to catch up

with the times9

Not all consumersare the same 4

What do consumersmean by ‘natural’? 5

Making use of the‘clean label’ trend 10

Different products require different approaches 6

Colouring Foods offer a ‘clean label’ solution 11

we want natural ingredients

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1. Exploring the‘clean label’ trend

This report shows you the answers.

Claims that a product is ‘natural’ will catch the eye of anyone walking through a supermarket nowadays. They are living proof of a massive global movement that has shaken the food and beverage industry in recent years: the trend towards a healthy lifestyle involving natural food. Consumers are demanding products that are manufactured without additives – and especially without artificial colours. As a result, the demand for natural colours made from fruit and vegetables is getting stronger.

Proving the need for changeHowever, shoppers are becoming suspicious of seeing the word ‘natural’ on product labels, because it doesn’t always mean what they expect it to mean. Food manufacturers need to ensure that their ingredients are described in a believable way, so GNT recently commissioned a comprehensive consumer survey to examine how best to convey the desired message. Conducted by market research institute TNS, it asked people all around the world about their perspectives on healthy and natural food.

What we wanted to find out• What are consumers’ major nutritional concerns? • Which product characteristics and ingredients are important?• Which of these therefore influence the product selection most strongly? • What role do food labels and claims play?• What changes should manufacturers make to their recipes and packaging?

175175 consumers

Explorativeonline discussions

Parents withchildren between1-6 years old

Brazil, China,Germany, Indonesia,Poland, the UK andthe USA

qualitativequantitative

5,0005,000 consumers

Online survey

Age 18 to 70

Brazil, China,France, Germany,

Indonesia, Poland,Spain, Thailand,

the UK and the USA

Focus onice cream, yoghurt,

soft drinks and sweets

Countries surveyed5,175 consumers participated

Survey methodology:Two-step method with quantitative and qualitative phases

of consumers worldwide check the ingredients66%

CLEANLABEL

62%

61%

60%

60%

58%

57%

55%

54%

48%

67%Easy-to-understand ingredient information

No artificial additives

No preservatives

Free from artificial colours

Clear nutrition facts on front of packaging

No artificial sweeteners

With natural flavours

Low in saturated fats

With natural colours

No E-numbers on the ingredient list

2. ‘Clean’ labelsare very much in demand

One thing has become utterly clear: the age of ignorance is over. Today’s consumers pay closer attention than ever to what they eat and drink every day. They want to know what is inside the products they buy. Shopping for groceries is not just an annoying duty but a chance to give oneself and the family a healthy treat. Checking for unwanted ingredients has also become routine.

Food labels must be easy to understandTo make a substantiated purchasing decision, shoppers depend on easy-to-understand product information. They are looking for ‘clean label’ products with short ingredient lists whose components they know and understand.

A quick check for unwanted ingredientsWhen looking at a label, consumers don’t always have time to evaluate every component of a product individually. They often resort to a method of elimination and just scan the label for certain ingredients they personally avoid.

No additives, pleaseTop of the consumer blacklist are artificial additives, especially preservatives and colourants.

What consumers want to see on the labelProportion of consumers whose purchasing decision is influenced by certain characteristics

3. Colour is key

How natural is ‘natural’?Shoppers have a clear idea of how they define ‘natural’ colourants:

• 93% of consumers place most value on visual factors when selecting their groceries

• Two thirds of consumers reject artificial colourants in food and beverages• More than half of consumers particularly value the use of natural colourants

• 42% expect natural food colourings to only originate from edible raw material such as fruit and vegetables

• Only 21% perceive colours made from substances such as insects or minerals to be truly natural

• Synthetically produced colours are accepted by only 5% of people

The challenge is to fulfil this need for naturalness without having to compromise on product appearance.

Colour is a key factor when shoppers are evaluating food and drinks: it often determines whether or not a product finds its way into the shopping basket. This is of course no surprise. The colour and shade of a product can communicate taste, brand, value and quality: we eat with our eyes. At the same time, it is hugely important what actual kind of food colour is used:

4. Not all consumers are the same

A key demand of consumers in all countries surveyed is for a healthy and well-balanced diet. Still, the wish for natural food and beverages is not equally strong among all respondents and has to be reconciled with different lifestyles and expectations. We identified five different consumer types, which are distributed differently around the globe. Each of these has different priorities with regard to their diet – from fast-food fans through to those who meticulously check all their foods and drinks.

The five consumer types worldwide:

36%

15%

15%

22%

12%

Busy Health Seekershealth-conscious consumers without much time

Conscious Health Seekerspaying attention to a balanced diet

Adding up to 78% of the population worldwide, these groups largely determine the trend for naturalness.

Caring Parentswhen children are the

motivation for natural goodness

ConvenienceSeekers

food must be quick & simple

Budget and Basics

Seekersaffordability has to take

priority over naturalness

4. Not all consumers are the sameBusy Health Seekers • The largest group worldwide • Have a keen interest in naturalness• Need to reconcile this with a hectic lifestyle • Don’t have the time or knowledge to assess ingredients in detail• Usually aged between 25 and 44, with children under 12

International aspects: This group’s prevalence in Asia is eye-catching: Busy Health Seekers account for the majority of the population in China (66%), Indonesia (63%) and Thailand (70%).

Conscious Health Seekers • Pay special attention to a balanced diet containing natural ingredients• Invest a huge amount of time and money in a healthy lifestyle • Composed largely of women and older people whose children have already left home

International aspects: About 25% of French and German consumers and 19% of Spaniards are Conscious Health Seekers. In Brazil, where 18% of people belong to this group, a prime motivation is to look attractive.

Caring Parents • The consumer type most uniformly spread around the globe • Often opt for a healthy diet due to having kids• Are motivated by concern for their children’s nutrition and well-being • Are conscious about which food and ingredients they buy• Want to be a good role model in purchasing healthy food • Many are aged between 35 and 44, female, with children under 12

International aspects: This consumer segment unites parents all around the world.

Budget and Basics Seekers• See the most important aspect of food and beverages as the price• Cooking has to be affordable and uncomplicated • Would like to eat more natural foods, but have a very limited budget • Are typically older than 45, with children still living at home

International aspects: This group is particularly numerous in France and Germany, where it accounts for 24% of the population. In Spain and the USA, the figure is 20%.

Convenience Seekers • Want food to be prepared quickly and conveniently• Are happy to go without a healthy and balanced diet for this.• Predominantly male, single and aged between 18 and 34

International aspects: In the UK, with its vast array of ready-to-cook meals and fast-food options, this type constitutes the largest (39%) share of all consumers, compared to 29% of people in the USA, 29% in France and 28% in Germany.

Who they are and how they behave:

Has no artificial colours

Has no preservatives

Has no artificial flavours

Has no artificial sweeteners

Is in its natural state

Is 100% pure

Is fresh

Only contains natural colours

Is high in vitamins and minerals

79%

79%

77%

77%

77%

76%

76%

73%

70%

5. What do consumers meanby ‘natural’?

It is obvious that the call for natural products is getting louder. But what exactly do consumers understand by ‘naturalness’ in relation to packaged/convenience food products? Here’s what most of them said:

• 75%: Natural food should contain no additives• 72%: Packaged food can be natural• 64%: Natural and healthy food are the same

Natural = no artificial coloursWhen asked about the meaning of ‘natural’ food, the top answer worldwide was a lack of artificial colours, followed by no preservatives or artificial flavours.

This has clear implications for brand communication. The term ‘natural’ raises certain expectations among consumers that must be met by the ingredients of the product in question. ‘Naturalness’ also has to be communicated credibly and be easily verifiable.

Number of people who thought that the following should apply to products described as ‘natural’:

Proportion of consumers who agree with various statements about different product categories:

“Products in this category very often contain undesirable additives”

“I would purchase these products more often if they were made from natural ingredients”

“I specifically want to avoid packages with ingredient information that is difficult to understand”

“I specifically want to avoid artificial colours”

59% 56% 39% 24%

30% 35% 37% 41%

41% 43% 41% 47%

48% 50% 48% 50%

DRINKS

YOGHURT

ICECREAM

SWEETS

6. Different products require different approaches

The expectations of consumers with regard to naturalness are not uniform across all categories. Instead, the role that ingredients play in the purchase decision depends on the particular product. We therefore took a closer look at four product segments: soft drinks, sweets, yoghurt and ice cream.

With sweets and soft drinks, consumers assume – but don’t approve of – the use of artificial ingredients: more than half of respondents thought that these products usually contain synthetic additives. Nevertheless, more than one person in three would buy sweets, lemonade, ice cream and the like more frequently if they were made with natural ingredients only. Yoghurt is the food category perceived as most natural. Two thirds of all respondents refuse to accept additives in yoghurt and would like it to only contain natural ingredients.

Key conclusionsWe have to accept that certain products, like yoghurt, have to meet particularly high requirements nowadays. For these products, natural ingredients are mandatory.

The demand for naturalness and clear ingredient information has reached all areas of food and drinks. Even in categories associated more with snacking and nibbling than with healthy nutrition, consumers are increasingly sceptical towards additives and E-numbers.

When it comes to sweets and soft drinks, about 40% of consumers avoid products with ingredient information that is difficult to understand. In these categories, replacing additives with natural alternatives can help brands to stand out and create an additional incentive for purchase.

• Is 100% naturally produced• Has no artificial colours• Is natural• Only contains natural colours• Is safe

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7. Positive colour claims canuplift brand preference

Bearing in mind the high value that consumers place on ‘clean’ labels, food manufacturers need to know exactly how to communicate the use of natural ingredients.

Say it on the frontFront-of-pack claims give producers the potential to uplift brand preference. Yet not every description is equally promising. Only those which are perceived as credible lead to a stronger purchase intention. It’s therefore crucial to understand consumers’ reaction to labelling.

Use a claim that consumers will believeAdditive colourants are the top concern, so we investigated how to communicate their absence most effectively. The two claims ‘with natural colours’ and ‘coloured with fruit and vegetables’ are perceived as credible by more than 75% of consumers. The latter also conveys many positive product characteristics.

Differences per categoryWith food and beverages perceived as generally less natural, such as sweets or soft drinks, the claim ‘coloured with fruit and vegetables’ uplifts brand preference by providing a clearly differentiating message. In food categories with a more natural image, like yoghurt, the claim ‘free from artificial colourants’ has a similarly positive effect.

Top five benefits consumers understand from the claim

‘Coloured with fruit and vegetables’:

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16.4% 18.9%

9.2% 9%

20.3% 32.2%

13.8% 20.5%

•NO ARTIFICIA

L COLOURS

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16.4% 18.9%

9.2% 9%

20.3% 32.2%

13.8% 20.5%

•NO ARTIFICIA

L COLOURS

No artificial colours• Brand preference rose by between 9.2% and 20.3% depending on the product• This was a ‘negative’ claim as it communicated what wasn’t in the product,

rather than what was

Coloured with fruit & vegetables• Brand preference rose by between 9% and 32.2% depending on the product• This claim proved to have the strongest impact• It communicated the use of natural ingredients clearly and positively• Brand preference was still significantly enhanced even when a price increase

was applied

International aspectsAlthough the uplift in brand preference always depends on the specific country, brand and existing preference share for a product, these results clearly underline the potential positive impact that the right front-of-pack claim can have on purchase decisions.The claim ‘Coloured with fruit & vegetables’ has particularly strong potential in Asia, where the vast majority of consumers are Busy Health Seekers and therefore very interested in natural products that are easy to find. In Asia, using this claim resulted in an average increase in brand preference of 40% across all categories, followed by 22.4% in Brazil, 14.8% in Europe and 5.4% in the US.

Impact of natural colour claims: average uplift in brand preference per claim

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Front-of-pack claims that enhance brand preferenceWe then conducted a profound conjoint analysis to get further insights on the different claims’ potential to increase brand preference. The analysis simulated a typical supermarket shelf scenario.

Who checks the ingredient labelbefore buying a product?

75% of parents61% of people who have

no children at home

Who places great value onnatural food and drinks?

82% of parents67% of people who haveno children at home

8. Particular concerns for parents

Certain consumer groups – such as parents – have an above-average interest in nutrition. All around the world, they place an even greater value on natural food and drinks than people without children. Their motives are clear: parents want to make sure their children grow up healthily, and also want to serve as role models. Because of this, their shopping behaviour is different.

Three out of four mothers and fathers are willing to accept a higher price when choosing healthy products for their kids

How parents live and shopWhen trying to juggle children, jobs and household chores, parents often run short of time.46% of them consider ready-to-eat products a good alternative to fresh food.Nevertheless, many of them only allow convenience food on their plates when they are convinced of its naturalness.Three out of four parents worldwide do not compromise on their children’s meals, and buy healthy products even though this means investing more time and effort. 70% of all parents avoid purchasing food with synthetic additives.59% of parents around the world see ‘natural colours’ as one of the most important buying criteria.

“Parents want to buy natural food and drinks for their children.At the same time, they want meals to be easy and quick.

This presents an opportunity to food manufacturers,if they can offer products that fulfil both needs.”

– Dr. Hendrik Hoeck, CEO of GNT Group

57%

22% 31%

24%

8. Particular concerns for parents 9. Food manufacturers need

to catch up with the times

The call for naturalness and clean labels is shaking the food and beverage industry. More and more manufacturers are changing their recipes and replacing artificial additives with natural alternatives. Yet consumers feel that most producers are not taking this trend seriously enough, or are suspicious of products with ‘natural’ claims.

Many products aren’t natural enough Fewer than 16% of consumers felt that products on the market are sufficiently natural.More than 55% thought that soft drinks and sweets usually contain undesired additives.24% and 39% of consumers felt the same about yoghurt and ice cream respectively.

45% of consumers don’t believe in brands that claim to be natural They feel the ‘naturalness’ claims on the front of the pack don’t match the complex ingredient list on the back.

People often don’t trust what they see on the pack

Proportion of consumers who think they can trust most of the products in a category and feel what is mentioned on the packaging is credible:

It’s time to reach out to consumersThere is a need to build trust and to offer clear ingredient information

Tailored segmentation example:Caring Parent

Tailored segmentation example:Conscious Health Seeker

Tailored segmentation example:Busy Health Seeker

10. Making use of the‘clean label’ trend

This study clearly underlines their growing importance of ‘naturalness’ for consumers worldwide – and gives a detailed understanding of the term itself. In consumers’ minds, it is strongly connected to the absence of artificial additives and especially colourants. Replacing these with natural alternatives that meet consumers’ expectations can therefore provide manufacturers with a major edge over their competitors.

Keep it simpleNot every health-conscious customer has the time to meticulously check product labels. That’s why they appreciate time-saving methods that help them quickly find the healthy, natural products they’re looking for.

Clear, clean front-of-pack claims give a competitive advantageIt’s becoming crucial to communicate the use of natural ingredients explicitly on the label. Positive front-of-pack-claims significantly enhance brand preference, enabling manufacturers to develop attractive products for people seeking natural colourants.

Target the right consumer groupsAnother way to make use of the survey’s results is to develop products tailored to the needs of the three consumer groups leading the trend for naturalness:

• Busy Health Seekers with their hectic lifestyle• Conscious Health Seekers willing to invest time and money in their nutrition • Caring Parents who want to serve their children healthy food• Budget and Basics Seekers looking for natural products that are more affordable

Our marketing experts have concepts available for all of these consumer groups and can support you in making a targeted approach. Here are some examples:

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10. Making use of the‘clean label’ trend 11. Colouring Foods offer

a ‘clean label’ solution

Replacing artificial additives with ‘clean label’ alternatives calls for extensive expertise in the characteristics and specific requirements of different applications and ingredients. At the GNT Group, pioneer and innovation leader in the field of Colouring Foods, we have nearly 40 years of experience in producing truly natural colourants. Our EXBERRY® Colouring Foods are concentrates made exclusively from fruit, vegetables and edible plants by using only gentle physical methods such as pressing, chopping and filtering.

About EXBERRY® Colouring Foods• Can be used to give the desired colour shade and intensity to nearly all kinds of products• Fully match additive colours in terms of variety, stability, shelf life and colour brilliance • Allow the product to be labelled ‘Coloured with fruit & vegetables’

Developed with care• Our concentrates are mixed and precisely tailored to the individual needs of our customers • GNT has complete control over the supply chain, assuring optimal price stability and year-round

availability • We offer extensive support throughout the entire product development process

Colouring Foods fulfil the global consumer demand for natural, healthy food. They offer the ideal colouring solution to make food and beverage products future-proof – without having to compromise on colour brilliance, stability, shelf life or variety.

“The trust of consumers should not be undermined by communicating a product to be all-natural but not satisfying their precise expectations about the ingredients.“Dr. Hendrik Hoeck, CEO of GNT Group

Contact us todayTo find more about our Colouring Foods and how they can help to make your products more appealing to consumers, please contact us via info@gnt-group.com or get in touch with one of our global offices:

Headquarters, the NetherlandsGNT Group B.V.Industrieweg 26MierloNetherlands+31 40 7800 300

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PolandGNT Polska Customer Service Sp. z o.o.ul. Szarych Szeregów 2560-462 PoznańPoland+48 61 6565921

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United Arab Emirates GNT Middle East FZ LLCDIAC, Building No 3, Office No 002PO Box 500767DubaiUnited Arab Emirates+971 50409 0680

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USAGNT USA, Inc.660 White Plains Road10591 Tarrytown, NYUSA+1 914 524 0600